Policymakers were sharply divided over expanding the Bank of Japan's huge monetary easing plan last month, with opponents warning that the risks far outweighed any benefits, minutes from the meeting showed on Tuesday.
The BoJ surprised markets on October 31 by announcing it would inflate its asset-buying plan by up to 80 trillion yen ($676 billion) annually. The move was narrowly passed in a 5-4 vote among board members.
The decision, which came days after the US Federal Reserve wound down its own stimulus, has sent the yen plunging to multi-year lows against the dollar and euro while pushing equities to highs not seen since before the global financial crisis.
However, critics on the policy board questioned "the sustainability of its effects" and said the impact of fresh measures on the world's number three economy -- and the BoJ's drive to hit a 2.0 percent inflation target -- "would not be large". They also said it could "considerably" squeeze liquidity in Japanese government bond markets.
One member warned that the yen's weakness would batter small domestic firms, which are facing soaring import costs.
The four opposing members were Koji Ishida and Yoshihisa Morimoto, both former business executives seen as loyal to BoJ chief Haruhiko Kuroda, along with former private sector economists Takehiro Sato and Takahide Kiuchi.The close call suggested that Kuroda -- who was hand-picked by Prime Minister Shinzo Abe as part of a wider plan to kickstart the economy -- almost became the first BoJ chief to lose a vote on a policy that he backed, according to Dow Jones Newswires.
However, one member who supported the move said: "These measures were expected to produce stronger effects on corporate profits, employment, and wages than in the past", while another warned that failing to act could hurt the bank's credibility in helping kickstart the economy.
Following last month's policy meeting, Kuroda said Japan's economy was at a "critical moment" in emerging from years of deflation, and the BoJ would "not hesitate" to initiate more easing if necessary.
In a speech Tuesday morning, Kuroda again defended the decision, saying it was "necessary to pursue monetary easing more powerfully... and to reiterate (the BoJ's) unwavering resolution to achieving the price stability target of two percent".
Separately, the government on Tuesday maintained its outlook on the economy in November, after cutting its view in the previous two months.
The monthly economic report said the economy was moderately recovering but "weakness can be seen in private consumption".
Japan's economy plunged into recession during the third quarter, prompting Abe to delay a planned sales tax rise next year and call snap elections.